Question

Frank, age 35, and Joyce, age 34, are married and file a joint income tax return for 2019. Their salaries for the year total $84,800 and they have taxable interest income of $3,900. They have no deductions for adjusted gross income. Their itemized deductions are $24,700. Frank and Joyce do not have any dependents.

Answer 1

The question is not complete.

Here is the complete part:

Table for the standard deduction

Filing Status 2018 Standard Deduction

Single $ 12,000

Married, filing jointly $24,000

Married, filing separately $12,000

Head of household $18,000

Qualifying widow(er) $24,000

If an amount is zero, enter "0".

a. What is the amount of their adjusted gross income?

$

b. What is their deduction for personal exemptions?

$

c. What is the amount of their taxable income?

$

Here are the answers:

a. Adjusted Gross Income = $88,700

b. Personal exemptions = $0

c. Taxable Income = $64,000

Step-by-step explanation:

a .Adjusted Gross Income is calculated by adding income from various sources and subtracting any specific deductions.

For Frank and Joyce, the adjusted gross income is :

$84,800 + $3,900 - $0 (no deductions for adjusted gross income) = $88,700.

b. Personal exemptions equals is $0 because it has been phased out in 2017.

c. The taxable income is derived by deducting standard deduction or itemized deductions (whichever is higher) from adjusted gross income.

Taxable income = Adjusted gross income - deductions ( standard or item-whichever is higher).

The standard deductions of $24,000 for married, filling jointly is lower than their itemized deductions, so the latter will be used.

Hence, the taxable income = $88,700 - $24,700

Taxable income = $64,000